"The Palestinians are intentionally insisting on preconditions that we cannot abide in order to prevent the start of negotiations," Netanyahu told the Knesset Foreign Affairs and Defense Committee. "As far as I'm concerned, setting preconditions is an obstacle that cannot be passed."

He contended Palestinian leaders put forth new demands every time Israel concedes on earlier ones, The Jerusalem Post reported.

Netanyahu said the option of a bi-national state would not be a good idea for Israel and that any Palestinian state must be demilitarized and secured by the Israel military.

Netanyahu also said settlement building in the contested territories goes on.

"Still, we need to understand what is happening around us. We need to be smart, not just right," he stated. "Settlements in the blocs do not significantly change our ability to reach an agreement. That is a false claim."

Foreign Affairs and Defense Committee Chairman Avigdor Lieberman said he doubts there will be any negotiations in the near future.

"There were attempts [to renew talks] in the last government that didn't work. First, there was a building freeze [in the settlements], and then King Abdullah of Jordan made an effort," Lieberman recounted.

"King Abdullah said how he felt. I think he was very honest. He pointed a finger and said who is to blame for lack of talks," referring to the Palestinians.